GME, a parody memecoin of GameStop, the American gaming retailer, has achieved a market capitalization of over $100 million in the midst of a trading frenzy surrounding its unrelated namesake. As of May 14, the GME memecoin has experienced a 2,291% return in the past week and is currently trading at $0.01449. This surge in value has been largely driven by investor interest in GameStop Corp shares, which have risen by 228% in the last five trading days.
The listing of the GME memecoin on centralized exchanges such as Bitget and BingX has further fueled buying activity. Additionally, the unexpected return of Keith Gill, the trader who played a significant role in initiating the Reddit-fueled GameStop short squeeze earlier this year, has led to another short squeeze of GameStop shares. Following Gill’s return, GameStop shares rallied by as much as 111% in just 24 hours.
The market euphoria surrounding these developments has not only benefited regular traders but also GameStop’s CEO, Ryan Cohen, who reportedly holds $1 billion in unrealized capital gains resulting from the ongoing short squeeze.
The memecoin craze has captivated the crypto industry this year. For example, on May 13, the Pepe the Frog memecoin Pepe (PEPE), based on Ethereum, saw a 34% rally in a single day, reaching a new record high of $0.00001119 on Binance. Similarly, on March 22, the Solana memecoin Dogwifhat (WIF) reached a record high after a successful $700,000 fundraising campaign. Shortly after the campaign, WIF’s price surged by 25%, briefly reaching $3 and a total market capitalization of $3 billion.
In another instance, a trader reportedly turned $13,000 into $2 million within a few hours by investing in the Donotfomoew (MOEW) memecoin, deployed on the Base blockchain. The trader bought MOEW shortly after its launch and sold their positions once the coin gained traction.
The reckless nature of investors speculating on memecoins has raised concerns among experts. In a statement on April 24, decentralized finance expert ZachXBT highlighted that 12 Solana memecoins raised a total of $26.7 million from investors before abruptly abandoning their projects. The most expensive “abandoned” presale project, according to ZachXBT, was a memecoin called “I like this coin” (LIKE).
Overall, while memecoins continue to rally, it is important to note the potential risks involved and heed the warnings from industry experts.